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Three-D Issue 31: What should the Cairncross Review do?

Natalie FentonGoldsmiths, University of London
Chair, Media Reform Coalition

The Department for Digital, Culture, Media and Sport established the Cairncross Review in March 2018 to examine the sustainability of high-quality journalism in the UK. The Review is particularly concerned with the Press and says that it will give equal weight to the needs of ‘consumers and industry’. The local press – that have faced the brunt of cost-cutting regimes in news corporations – is singled out for attention. Talking about ‘consumers’ rather than ‘citizens’ may be indicative of where the Review’s sympathies lie. Many fear that its real intention is to justify subsidising corporate news organisations that have already failed to act in the public interest and are more concerned with profit margins than democratic intent. There is a general consensus however, that news media institutions in the UK are facing multiple crises: of funding, trust, representation, accountability and legitimacy and that something needs to be done about it.

Confronting the problems

Newspaper and magazine readership is in serious decline as large digital intermediaries gobble up the majority of advertising revenue. Local news is increasingly under threat. Research from 2017 showed that the majority of the UK population (57.9%) is not served by a local daily newspaper. (MRC, 2017). The number of Local Authority Districts (LADs) in the UK with no daily local newspaper coverage is 273 out of 406 (45%) across the whole UK. Local daily papers are overwhelmingly located in major urban areas. Only 80 LADS are directly served by a daily newspaper with another 53 covered by local dailies in adjacent or nearby LADs. Between November 2015 – March 2017 five LADs suffered a loss of plurality through closures, and were reduced to single-publisher monopolies, increasing the number of local monopolies to 170 out of 380 in England, Wales and Scotland. In combination with previous research, this identifies 1,103 local newspaper titles in the UK as of March 2017 – more have followed since.

In addition to the net loss of titles, there were 30 separate instances of announced job cuts over the 17-month period involving the loss of 418 jobs. Newsquest, with 12 announcements affecting 139 jobs led the way, followed by Trinity Mirror (at least 102 jobs) and Johnston Press (100 jobs). As well as job cuts, reorganisations affected a further 83 jobs, and six newspaper office closures were recorded, with journalists in some instances being moved long distances away from the communities they serve. This research also points to deeper problems in the local newspaper industry with some local papers no longer providing content of relevance to the local communities or providing sufficient coverage of court and council proceedings along with an over-reliance on click bait to attract audiences.

Additionally, we are seeing declines in the levels of trust in news media, a phenomenon that is particularly acute for those on low incomes, BAME audiences and young people. Concentration of media ownership is likely to be related to this decrease in legitimacy that goes hand in hand with the general decrease in trust of elites (and particularly political elites)with the general decrease in trust of elites (and elites. The UK has a supposedly competitive national newspaper market but just 5 companies control 90% of daily circulation and help to set the agenda for the rest of the news media and the situation is only getting worse (The MRC is due to release new research on current levels of concentration of media ownership in Spring 2019).

Legacy press may have lost the trust of the nation but they have not lost the ability to influence the public conversation and conduct of the rest of the media. Research on the agenda setting influence of right wing newspapers on broadcast news coverage of the 2015 General Election in the UK (Moore and Ramsey, 2016) and the coverage of the European Union Referendum points to the continuing ability of those voices to distort conversations about contemporary politics (Centre for Research in Communication and Culture, 2016).

This is complicated yet further with the likes of Google and Facebook. Ofcom show high levels of news consumption through third-party platforms. But before we conveniently point the finger at the new global giants on the block we should be aware that the 2017 (p.19) Digital News Report from the Reuters Institute also states that “the vast majority of news people consume still comes from mainstream media and that most of the reasons for distrust also relate to mainstream media.”

Alternative perspectives point to the rapid growth of digital media as offering a diverse abundance of news and a means of plugging the growing democratic deficits. There is no doubt that while print circulation of local news content has decreased dramatically, digital circulation has risen (MRC 2017). But the growth of digital audiences has, so far, failed to compensate for the losses of print revenue. Furthermore, the agreement between sections of the local newspaper industry and the BBC for the BBC to provide 150 local democracy news reporters has done little to offset the more than 400 jobs that have been lost. The NUJ have also expressed concern that companies are using BBC funding cynically to cut costs (making other journalists redundant) rather than to enhance news (employing people on exploitative contracts with less pay than their colleagues).

The levels of concentration together with the closures and job cuts identified in these reports demonstrate that we need remedial action to protect local news. However, repairing the democratic deficits caused by an inadequate media environment requires not just rebuilding trust but also the creation of a healthy communications environment – one that is not just economically robust but innovative, diverse, independent of vested interests and sensitive to the changing political geography of the nation.

Imagining the solutions

The MRC argue, that what is required is a set of local news policy interventions that can stimulate independent, pluralistic, local news.

Such interventions should not only be aimed at the printed newspaper industry, but should recognise the period of huge digital transformation we are witnessing. Our objective is to boost plurality and to support investment in local newsgathering without triggering equivalent cuts in response. In the MRC’s submission to the Cairncross Review we proposed a networked local news wire service that resources existing local news providers on the one hand, whilst also offering a significant boost to plurality at the level of wholesale newsgathering. Such an initiative could be designed to derive the maximum scale efficiencies of a nationally coordinated network, whilst preserving the autonomy and independence of the network nodes (‘local news hubs’ – Fenton et al., 2010).

We would like to see a new infrastructure for local news provision: a network of approximately 400 local news hubs mapped according to local authority districts. Each hub could consist of at least four full-time staff covering reporting and editing roles, and operating out of a small newsroom space located in the community it serves. Daily newswire copy could be fed into a centralised national database that subscribing publishers would have instant access to. In-depth exclusive features could be made available via an embargoed pool on a first-come-first-serve basis. Any output that is not picked up by subscribers after a given time limit could then be published through the wire network’s own locally branded platforms. A dedicated national news desk could also monitor daily copy to leverage any news of relevance to a national audience.

The national contractor should be a non-profit entity with a governance structure that ensures its independence and commitment to nourishing the vitality of local news, as well as preserving the editorial independence of the local news hubs. We believe that the wire service could be sustained by a hybrid model of funding including subscriptions and donations. But above all, we propose that it should be supported by public subsidy derived from a small levy on the UK revenues of major search and social media companies.

The rise of platform monopolies like Google and Facebook has dramatically encroached on the local advertising and classified markets that formerly sustained much of the local news industry. At the same time, local news titles are often squeezed out of the news agendas promoted by major news algorithms and intermediaries which tend to favour national news brands.

Given the demonstrable capacity for these monopolies to avoid corporation tax by redirecting profits away from the jurisdictions in which they are generated, there is both a moral and economic rationale for a small levy on their digital advertising revenues. There is also a long established precedent in media policy to enforce cross-subsidy from the most profitable media in favour of media as a public good. The establishment of Channel 4, for instance, was made possible by the support of ITV in its formative years.

If a levy was imposed on those companies with more than a 25 percent share of the online search and social networking markets within the UK, it would currently impact only on Google and Facebook. Based on their last reported annual UK revenues, a one percent levy would generate in excess of £70 million a year – rather more than the £4.5m Facebookhave pledged over two years to regional media companies to provide 80 community reporters.

We also believe that local papers should be treated as community assets and whenever a paper is up for closure, it should first be offered to local journalists themselves to encourage alternative models of media ownership such as local co-operatives that will remove the emphasis on large profit margins and reduce concentration of ownership.

Public policy has, thus far, failed to stop the emergence of ‘news deserts’ and the jobs onslaught that we have seen across UK news media sectors. We believe that a comprehensive and strategic response is long overdue. This is a priority for government if it wishes to enhance political participation and reduce disengagement in part by facilitating coverage that speak to multiple geographical, political and cultural forms of belonging. It is also a priority for industry to contribute to this process as a robust local news environment will generate value for UK news as a whole and restore trust and credibility in areas that have had low levels of esteem in recent years. Yet neither the legacy press nor digital intermediaries should be the main beneficiaries of our proposals. Instead, it is publics – those individuals who have long been at the mercy of commercial decisions about investment and closure of which they have no control – who are the target of our plans for a new local news wire service.

The Cairncross Review is currently considering the evidence submitted as part of its public consultation and aims to identify the challenges and make recommendations on what industry and government action can be taken. The Cairncross report is due in Spring 2019. These proposals and others like them will be discussed at the annual Media Democracy Festival on March 16th 2019 at the Clore Centre, Birkbeck University – we’d love to see you there!

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